President Obama is fond of proposing that new government programs or give-aways be paid for by "taxing the rich." Soaking "the rich" has been a popular suggestion for a long time, because those who suggest it know that everyone will suppose that "the rich" are someone else--not them, certainly. "Let someone else," they say, "someone who has the money, pay for my college education. They can afford it, so why not?"
I have pointed out one "why not" below, which is that making someone else pay for your goods and services makes the nation as whole poorer -- a lot poorer. But the "tax the rich" mantra has more to do with attacking a class of persons than with finding funding for public goods--even assuming paying for private wants, like education, can be justified as a public good. This increasing hostility toward a class of persons called "the rich" is frightening, but it is also just mistaken.
Leftists talk about the rich as if they were evil. But who are they talking about, and what did they do to deserve our opprobrium? When it comes down to it, there is no one who fits the Left's description of "the rich," except "the rest of us" the Left claims to be defending.
Think about it: By using the phrase "the rich," the Left is talking about a whole group of people -- a class -- who have attained wealth by apparently illegitimate means, that is, by oppressing other people. To Leftists, "the rich" got that way through inappropriate use of power, using law, social structures, class discrimination and outright force to deprive others of their wealth. Indeed, Leftists cannot conceive of how anyone can grow wealthy except by forcing wealth out of other people's hands, as they do not understand (or they choose to ignore) that one can grow wealthy by work, invention, investment and trade, which do not take away wealth from anyone but create wealth, and make others wealthier, too.
Now, there are economic systems in the world built on illegitimate power structures that Leftists, or anyone for that matter, might properly condemn. Certainly it is wrong when a small group of persons who run the government apparatus accord to themselves the land, natural resources and productive power of a nation, paying themselves huge profits from exploiting those resources and the work of the populace, who are held, essentially through brute force, in penury. These persons become wealthy beyond all imagination, but through thievery. Recall that the important caveat to the rule that Trade Creates Wealth is that it does not apply if one is stealing, as that is just an involuntary transaction that destroys wealth. Enrichment by thievery, even government thievery, is always wrong. (Contrary to the Leftists' claims, the economic systems just described are not in nations run by right-wing dictatorships, but the Leftist utopias of modern-day Russia, Venezuela, Cuba and North Korea, left-wing dictatorships whose oppressive power structures Leftists curiously decline to criticize.) But the power structure that permits an oppressive few to enslave a whole nation and become "rich" simply does not exist in the United States. Thus, we can't call "rich" persons evil here because they are members of a class that preserves its status by oppressing and stealing their wealth from others. (If certain persons are getting wealthy through theft, they should go to jail, of course, but we don't have a class of "rich" who preserve their wealth through theft.)
But if the "rich" are not those who got that way through oppression, then who are they? They are not born into wealth, as many of the wealthiest Americans came from families of modest means (Warren Buffett, Bill Gates, the late Steve Jobs). And even if a person is fortunate enough to be born into a family that earned and saved money to hand down to future generations, that does not make him or her evil.
So who are "the rich" different from the "rest of us?"
Well, they are just people with money. They are those who earn a living, invest in mutual funds, buy a house and see it appreciate, who save money for college and retirement, maybe buy a car every few years or take the family on a nice vacation to Walt Disney World or Yellowstone. They are the productive members of our society, who get paid for what they do because they do it well and return more in value than what they receive. They design bridges, plan cities, build factories, produce corn or cement or lasers, or invent the next smartphone. Or they run the office, take out stitches, or do the books. Whatever it is they do, they make money, maybe a little, maybe a lot. They are in fact not sleeping on stacks of Grampy's thousand-dollar bills a la Thurston Howell III, but are everyday earners who make wealth for everyone. The rich are "the rest of us." The bastards! Who do they think they are?!
Thus, when über-class-warrior Elizabeth Warren says, "There is nobody in this country who got rich on his own," she has it exactly right, for exactly the opposite reason she thinks. She thinks no one got rich without taking from others, or at least without mooching off of the public goods (of roads, fire and police protection, public education) created by government. In fact, no one got rich in this country on his own because no one got rich without making others rich, generating the wealth that made entire cities and states prosperous, which in turn produced the tax base that paid for the public goods that everyone enjoys. (Where does Elizabeth Warren think the "rest of us" got the money used to pay for all of the public goods she cites, if not the "factory owners" ("Factory owners"?! Do you know anyone who owns a factory?) who first pay the taxes and then generate the payroll paid to the "rest of us," which governments so eagerly levy?)
Be careful, you who advocate war against the rich. The next neck in the guillotine may be your own.
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